biologics and biosimilars: background and key issues
TRANSCRIPT
Biologics and Biosimilars:
Background and Key Issues
Updated June 6, 2019
Congressional Research Service
https://crsreports.congress.gov
R44620
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service
Summary A biological product, or biologic, is a preparation, such as a drug or a vaccine, that is made from
living organisms. Compared with conventional chemical drugs, biologics are relatively large and
complex molecules. They may be composed of proteins (and/or their constituent amino acids),
carbohydrates (such as sugars), nucleic acids (such as DNA), or combinations of these
substances. Biologics may also be cells or tissues used in transplantation.
A biosimilar, sometimes referred to as a follow-on biologic, is a therapeutic drug that is highly
similar but not structurally identical, to a brand-name biologic (i.e., the reference product). This is
in contrast to a generic chemical drug, which is an exact copy of a brand-name chemical drug
(i.e., the reference listed drug). Because biologics are more complex than chemical drugs, both in
composition and method of manufacture, biosimilars will not be exact replicas of the brand-name
product, but may instead be shown to be highly similar. However, for many years, the drug
industry and the Food and Drug Administration (FDA) have coped with the inherent variability in
biological products from natural sources. FDA maintains that the batch-to-batch and lot-to-lot
variability that occurs for both brand-name biologics and biosimilars can be assessed and
managed effectively.
The FDA regulates both biologics and chemical drugs. Before a biologic or biosimilar may be
marketed in the United States, it must be licensed (i.e., approved) by FDA. To obtain licensure of
a new biologic, the sponsor (generally the manufacturer of the product) submits to the agency a
biologics license application (BLA) with data demonstrating that the biologic, and the facility in
which it is manufactured, processed, packed, or held, meet standards to assure that the product is
safe, pure, and potent. The Biologics Price Competition and Innovation Act (BPCIA)—enacted as
Title VII of the Patient Protection and Affordable Care Act (ACA, P.L. 111-148)—established an
abbreviated licensure pathway for biosimilar biological products or biosimilars. To obtain
licensure of a biosimilar, the sponsor submits to FDA a BLA that provides information
demonstrating, among other things, biosimilarity based on data from analytical studies (structural
and functional tests), animal studies (toxicity tests), and/or a clinical study or studies (tests in
human patients).
Since enactment of the BPCIA, as of May 29, 2019, 19 biosimilars—for nine reference
products—have been licensed in the United States. However, many of these licensed biosimilars
are not yet available to patients, primarily due to ongoing litigation, although various factors may
impact uptake of biosimilars.
Biologics and biosimilars frequently require special handling (such as refrigeration) and
processing to avoid contamination by microbes or other unwanted substances. Also, they are
usually administered to patients via injection or infused directly into the bloodstream. For these
reasons, biologics often are referred to as specialty drugs. The cost of specialty drugs, including
biologics, can be extremely high.
The high costs of pharmaceuticals in general—and biologics in particular—has led to an
increased interest in understanding the federal government’s role in the development of costly
new therapeutics. In the case of many biosimilars approved by FDA, the associated brand-name
biologic was originally discovered by scientists at public-sector research institutions. These
brand-name biologics—Remicade, Enbrel, Humira, Avastin—are among the top-selling drugs in
the United States and worldwide.
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service
Contents
Introduction ..................................................................................................................................... 1
FDA Regulation of Biologics .......................................................................................................... 3
Events Leading Up to Biosimilars Legislation ......................................................................... 5 New Regulatory Pathway for Biosimilars ................................................................................. 8
Approval and Marketing of Biosimilars ........................................................................................ 10
Patent Litigation and Settlements ............................................................................................. 11 Naming .................................................................................................................................... 14 Biosimilars Labeling ............................................................................................................... 16 Interchangeability and Substitution ......................................................................................... 17 Sample Sharing and Biosimilars Development ....................................................................... 18
Federal Research and Biologics Development .............................................................................. 19
Tables
Table 1. Relative Size of Chemical and Biologic Drugs ................................................................. 1
Table 2. Biosimilars Approved for Marketing in the United States by FDA.................................. 11
Table 3. Settlement Agreements Between AbbVie and Competitors............................................. 12
Table B-1. Top 15 Best-Selling Drugs of 2018 ............................................................................. 26
Appendixes
Appendix A. Major Laws on Biologics Regulation ...................................................................... 22
Appendix B. Top-Selling Drugs .................................................................................................... 26
Contacts
Author Information ........................................................................................................................ 26
Biologics and Biosimilars: Background and Key Issues
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Introduction A biologic or biological product is a preparation, such as a therapeutic drug or a vaccine, made
from living organisms, either human, animal, yeast, or microorganisms. Biologics are composed
of proteins (and/or their constituent amino acids), carbohydrates (such as sugars), nucleic acids
(such as DNA), or combinations of these substances. Biologics may also be cells or tissues used
in transplantation.
A biosimilar, sometimes referred to as a follow-on biologic, is a therapeutic drug that is highly
similar but not structurally identical to a brand-name biologic, also referred to as the innovator or
reference product.
In contrast to biologics, most commonly used drugs—over-the-counter drugs and most
prescription drugs—are synthesized via a chemical process. A generic drug is chemically
identical to its reference brand-name drug. The molecular structure of a commonly used chemical
drug is much smaller than a biologic and therefore less complicated and more easily defined. For
example, Table 1 shows that the chemical drug aspirin contains nine carbon atoms, eight
hydrogen atoms, and four oxygen atoms while the large biologic drug Remicade contains over
6,000 carbon atoms, almost 10,000 hydrogen atoms, and about 2,000 oxygen atoms. Inflectra,
which is biosimilar to Remicade, was approved by the Food and Drug Administration (FDA) in
April 2016.
Table 1. Relative Size of Chemical and Biologic Drugs
Drug (nonproprietary name) Molecular formula
chemical drugs
aspirin C9H8O4
Tylenol (acetaminophen) C8H9NO2
Sovaldi (sofosbuvir) C22H29FN3O9P
small biologic drugs
Lantus (insulin glargine) C267H404N72O78S6
Epogen (epoetin alfa) C809H1301N229O240S5
Neupogen, Zarxio (filgrastim) C845H1339N223O243S9
growth hormone (somatropin) C990H1528N262O300S7
large biologic drugs
Enbrel, Erelzi (etanercept) C2224H3472N618O701S36
Remicade, Inflectra (infliximab) C6428H9912N1694O1987S46
Source: Drugs@FDA, https://www.accessdata.fda.gov/scripts/cder/daf/, and Drugs.com.
Notes: The nonproprietary name of a drug product is used in drug labeling, drug regulation, and scientific
literature to identify a pharmaceutical substance or active pharmaceutical ingredient. C, carbon; H, hydrogen; O,
oxygen; N, nitrogen; F, fluorine; P, phosphorus; S, sulfur.
Biologics and biosimilars frequently require special handling (such as refrigeration) and
processing to avoid contamination by microbes or other unwanted substances. Also, they are
usually administered to patients via injection or infused directly into the bloodstream. For these
Biologics and Biosimilars: Background and Key Issues
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reasons, biologics often are referred to as specialty drugs.1 In the past, biologics were often
dispensed by pharmacies with specialized facilities and personnel. The term specialty drugs is
now often used to describe drugs that are expensive for any of several reasons, including the
requirement for special handling.
The cost of specialty drugs, including biologics, may be extremely high. For example, the annual
cost of some biologic medications in the United States, such as Soliris (eculizumab) and Vimizim
(elosulfase alfa), exceeds $250,000 per patient.2 The use of biologics and spending on these
products has been increasing; see for example Appendix B. Spending on biologics in the United
States totaled $120.1 billion in 2017, a 12.5% increase over 2016.3 The amount spent on
“original” biologics subject to biosimilar competition in 2017 was $10.6 billion (8.8% of $120.1
billion), and the amount spent on biosimilars in 2017 was $0.9 billion (0.7% of 120.1 billion).4
Biologics spending has increased by 10% each year since 2011.5
Biologic drugs are often more expensive in the United States than in Europe and Canada.6 In
Europe, the introduction of biosimilars has reduced prices for biologics, which may be attributed
to price regulation interventions and commercial decisions of manufacturers.7 For example, in
October 2018, AbbVie agreed to an 80% price reduction in certain European countries on the
monoclonal antibody Humira, the top selling drug in the world, after the introduction of several
biosimilars there.8
Biologics and biosimilars are larger in size than chemical drugs and their manufacturing and
purification processes can be more complicated and more expensive than those used to make
chemical drugs. However, information about manufacturing costs for drugs and biologics is
generally not publicly available, although a few studies have attempted to estimate the cost of
production of certain biologics. For example, one study examined the cost of insulin production,
concluding that “it may be possible to profitably manufacture biosimilar insulins at prices of
US$72 per year or less for human insulin and US$133 per year or less for insulin analogues.”9
The study notes several limitations, including that expenses associated with registration, quality
assurance and control, and other costs were not individually considered. Additionally, as
explained later in this report, for historical reasons, insulin has been regulated by FDA as a drug
rather than as a biologic; as such, there are currently no biosimilar insulins available in the United
States. Another analysis looked specifically at the manufacturing processes for therapeutic
1 For further information, see CRS Report R44132, Specialty Drugs: Background and Policy Concerns.
2 Aaron S. Kesselheim and Jerry Avorn, “The High Cost of Prescription Drugs in the United States: Origins and
Prospects for Reform,” JAMA, vol. 316, no. 8 (August 23/30, 2016), pp. 858-871.
3 QuintilesIMS Institute, Medicine use and spending in the U.S.: A review of 2017 and Outlook to 2022, April 2018, p.
11.
4 Ibid.
5 Ibid.
6 Jeanne Whalen, “Why the U.S. Pays More than Other Countries for Drugs,” The Wall Street Journal, December 1,
2015.
7 IMS Health, The Impact of Biosimilar Competition, June 2016, p. 4, http://ec.europa.eu/growth/tools-databases/
newsroom/cf/itemdetail.cfm?item_id=8854.
8 Ed Silverman, “AbbVie offers a ‘huge’ discount on Humira to fend off European rivals,” STAT+ Pharmalot,
November 1, 2018. Zachary Brennan, “AbbVie Sees 80% Discounts in Nordic Market With New Humira Biosimilars,”
RAPS Regulatory Focus, November 2, 2018, at https://www.raps.org/news-and-articles/news-articles/2018/11/abbvie-
sees-80-discounts-in-nordic-market-with-ne.
9 D. Gotham, M. Barber, & A. Hill, “Production costs and potential prices for biosimilars of human insulin and insulin
analogues,” BMJ Global Health, 2018, doi:10.1136/bmjgh-2018-000850.
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monoclonal antibodies, a class of biologics that includes many cancer drugs. According to the
paper, which was authored by a bioprocess engineering expert at Genentech, monoclonal
antibodies “are becoming a unique class of therapeutic products… with unlimited production
capacity and low production costs, whose pricing will have no direct link to drug substance
product. The pricing will instead reflect the innovator companies’ clinical investment in addition
to costs incurred from failed pipeline products.”10
As discussed later in the report (see “Federal Research and Biologics Development”), many of
the top-selling brand-name biologics—for example, Humira, Remicade, Enbrel, Avastin—were
originally discovered by scientists performing basic research at public-sector institutions.
However, the next phase of research—clinical testing—is often claimed to be the most expensive
step in bringing a pharmaceutical product to market, although estimates for clinical trial costs
vary depending on the therapeutic area and study’s assumptions.
FDA Regulation of Biologics Biological products were originally regulated by the National Institutes of Health (NIH) and its
precursors. In 1972, this regulatory responsibility was transferred to FDA; see Appendix A of
this report for further details.
FDA generally regulates biologics pursuant to its authorities under the Public Health Service Act
(PHSA), but regulates some biologics as drugs under authorities in the Federal Food, Drug and
Cosmetic Act (FFDCA). Responsibility for regulation of biologics within FDA is shared by both
the Center for Biologics Evaluation and Research (CBER) and the Center for Drug Evaluation
and Research (CDER). CBER regulates what are often referred to as traditional biologics, such as
vaccines, blood and blood products, allergenic extracts, and certain devices and test kits.11 CBER
also regulates gene therapy products, cellular therapy products, human tissue used in
transplantation, and the tissue used in xenotransplantation—the transplantation of nonhuman
cells, tissues, or organs into a human.12
CDER regulates—in addition to prescription brand-name and generic drugs and over-the-counter
drugs—most therapeutic biologics. Responsibility for therapeutic biologics was transferred from
CBER to CDER in 2003.13 See Appendix A for further details. Examples of types of therapeutic
biologics regulated by CDER are briefly described in the list below.14
Monoclonal antibodies—proteins that bind to a specific substance in the body or
a specific cell. A monoclonal antibody may carry a drug or toxin. An example of
a monoclonal antibody product is infliximab, used to treat Crohn’s disease,
ulcerative colitis, rheumatoid arthritis, and psoriasis.
10 Brian Kelley, “Industrialization of mAb production technology: The bioprocessing industry at a crossroads,” mAbs,
vol. 1, no. 5 (2009), pp. 443-452. https://doi.org/10.4161/mabs.1.5.9448.
11 FDA, http://www.fda.gov/BiologicsBloodVaccines/default.htm.
12 CBER does not regulate the transplantation of vascularized human organ transplants such as kidney, liver, heart,
lung, or pancreas. The Health Resources Services Administration (HRSA) oversees the transplantation of vascularized
human organs.
13 Federal Register, vol. 68, no. 123, June 26, 2003, pp. 38067-38068. CDER’s work covers more than just medicines.
For example, fluoride toothpaste, antiperspirants, dandruff shampoos, and sunscreens are all considered “drugs.” FDA,
About the Center for Drug Evaluation and Research, http://www.fda.gov/AboutFDA/CentersOffices/
OfficeofMedicalProductsandTobacco/CDER/default.htm.
14 Definitions from NCI Dictionary of Cancer Terms http://www.cancer.gov/publications/dictionaries/cancer-terms.
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Cytokines—proteins that control (stimulate or slow down) the immune system
and are used to fight cancer, infections, and other diseases. Examples include
interleukins, interferons, and colony-stimulating factors, such as filgrastim.
Growth factors—substances, such as hormones, made by the body that regulate
cell division and cell survival, such as the human growth hormone somatropin.
Enzymes—proteins that speed up chemical reactions in the body. Enzymes take
part in many cell functions, including cell signaling, growth, and division. In
cancer treatment, enzyme inhibitors may be used to block certain enzymes that
cancer cells need to grow.
Immunomodulators—substances that stimulate or suppress the immune system
and may help the body fight cancer, infection, or other diseases.
Most biological products are regulated—licensed for marketing by FDA via a biologics license
application (BLA)—under authorities in the Public Health Service Act (PHSA).15 This is in
contrast to chemical drugs, which are approved for marketing by FDA via a new drug application
(NDA) or abbreviated new drug application (ANDA). To obtain licensure, the sponsor (generally
the manufacturer) must demonstrate in the BLA that the biological product, and that the facility in
which it is manufactured, processed, packed, or held, meet standards to assure that the product is
safe, pure, and potent.16 As is the case with other FDA-approved products, any subsequent change
to the approved manufacturing process—such as a change in the supplier of a raw material or the
replacement of a piece of equipment—requires a demonstration to FDA of the comparability of
the product’s quality attributes before and after the change to ensure that the safety and
effectiveness of the product is maintained. For example, the brand-name biologic Remicade
(infliximab) underwent 37 manufacturing changes between 1998 and October 2014; each change
required a demonstration of comparability, most likely through chemical, physical, and biological
assays.17
Historically, certain biological products were regulated as drugs, approved via an NDA under the
FFDCA rather than as biologics by NIH under the PHSA. In 1941, Congress gave FDA authority
over the marketing of insulin, a natural source biological product.18 The hormone insulin is a
small protein (a short chain of 51 amino acids) and in the 1940s, it was obtained in the same way
as many biologics—extraction from animals—hence the term “natural source.”19 Despite this
15 PHSA Sec. 351(a).
16 Ibid. While FDA approves drugs that are “safe and effective” the equivalent terminology for biologics is “safe, pure
and potent.” In an April 2015 FDA guidance document, Scientific Considerations in Demonstrating Biosimilarity to a
Reference Product, the agency states that “[t]he standard for licensure of a biological product as potent under section
351(a) of the PHS Act has long been interpreted to include effectiveness (see 21 CFR 600.3(s) and the guidance for
industry on Providing Clinical Evidence of Effectiveness for Human Drug and Biological Products). In this guidance,
we use the terms safety and effectiveness and safety, purity, and potency interchangeably in the discussions pertaining
to biosimilar products.”
17 Comments by Brian Lehman, Manager of Pharmacy Benefits and Policy, Ohio Public Employees Retirement System
(OPERS), at the June 20, 2016, Alliance for Health Reform briefing, “The Emerging Biosimilars Market,” webcast at
https://www.youtube.com/watch?v=XZvhLYZ_TZg; and, FDA, CDERLearn website, FDA Overview of Biosimilar
Products, slide 13 in Module 4 “Complexity of Biological Product Manufacturing,” http://fdabiosimilars.e-paga.com/
course/framework/.
18 David M. Dudzinski, “Reflections on Historical, Scientific, and Legal Issues Relevant to Designing Approval
Pathways for Generic Versions of Recombinant Protein-Based Therapeutics and Monoclonal Antibodies,” Food and
Drug Law Journal, (2005) vol. 60, p. 153. The Insulin Amendments, P.L. 77-366, codified at 21 U.S.C. 356, were
repealed by P.L. 105-115, the Food and Drug Administration Modernization Act (FDAMA).
19 Ibid., p. 154.
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similarity with other biologics, insulin was regulated as a drug by FDA rather than as a biologic
by NIH. Besides insulin, a small set of other natural source biological products have been
regulated as drugs under the FFDCA rather than as biologics under the PHSA: the hormone
glucagon, human growth hormone, hormones to treat infertility, hormones used to manage
menopause and osteoporosis, and certain medical enzymes (hyaluronidase and urokinase).20
In the late 1970s and early 1980s, the biotechnology industry began to develop its first biologics
for use as human therapeutic agents (e.g., recombinant proteins and monoclonal antibodies).
Some of these products were regulated as drugs under the FFDCA (e.g., insulin and human
growth hormone created using recombinant DNA technology), while others were regulated as
biologics under the PHSA (e.g., cytokines, proteins involved in the immune response, and blood
factors). As such, currently, while most biologics are licensed under the PHSA, some are
approved as drugs under the FFDCA. This will no longer be the case on March 23, 2020, when
applications for biologics approved under the FFDCA will be deemed to be licenses under the
PHSA (see “New Regulatory Pathway for Biosimilars”).21
In 2010, the Biologics Price Competition and Innovation Act (BPCIA)—enacted as Title VII of
the Patient Protection and Affordable Care Act (ACA, P.L. 111-148), established an abbreviated
pathway under the PHSA for licensure of biosimilar biologics (i.e., biosimilars, sometimes
referred to as follow-on biologics). A biosimilar is a biological product that is demonstrated to be
“highly similar” (i.e., biosimilar), but not identical, to an FDA-licensed biological product (i.e.,
the reference product). The next sections describe events leading up to the enactment of the
BPCIA and provide an overview of the requirements governing the abbreviated licensure process
for biosimilars.
Events Leading Up to Biosimilars Legislation
In contrast to biosimilars, generic drugs have been able to be marketed in the U.S. since 1984
when the Drug Price Competition and Patent Term Restoration Act of 1984 (P.L. 98-417)—often
called the Hatch-Waxman Act—established an abbreviated approval pathway for generic
chemical drugs. By offering a lower-priced alternative to brand-name drug products, the Hatch-
Waxman Act has been credited with lowering the cost of drugs to consumers, as well as allowing
the U.S. generic drug industry to expand.22 For chemical drugs, “generic medications decrease
prices 60% to 90% on branded oral-solid medications,” according to some experts.23 Generally,
generic drug manufacturers achieve cost savings by avoiding the expense of clinical trials, as well
as the initial drug research and development costs incurred by the brand-name manufacturer.
To obtain approval of a generic drug, the manufacturer submits to FDA an ANDA demonstrating
that the generic drug is the same as the brand-name drug (i.e., the reference listed drug [RLD]).
To prove sameness, the generic must have the same active ingredient(s), strength, dosage form,
and route of administration as the RLD; be bioequivalent to the RLD; and meet other
requirements (e.g., reviews of chemistry, manufacturing, controls, labeling, and testing).24 This
20 Janet Woodcock, Deputy Commissioner, Chief Medical Officer, FDA, testimony before the House Committee on
Oversight and Government Reform, March 26, 2007, at http://www.fda.gov/newsevents/testimony/ucm154070.htm;
and BIO Citizen Petition, Follow-on Therapeutic Proteins, April 23, 2003, http://www.fda.gov/OHRMS/DOCKETS/
DOCKETS/03p0176/03p-0176-cp00001-01-vol11.pdf.
21 BPCIA § 7002(e).
22 For additional information, see CRS Report R44643, The Hatch-Waxman Act: A Primer.
23 Jonah Houts, Express Scripts, Inc., testimony before the House Committee on Oversight and Government Reform,
Hearing on “Safe and Affordable Biotech Drugs: The Need for a Generic Pathway,” March 26, 2007.
24 FFDCA §505(j).
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“sameness” allows the generic company to rely on, or “reference,” the FDA’s previous finding of
safety and effectiveness for the already approved drug. A generic drug is generally considered to
be interchangeable with its reference (brand-name) drug and with other generic products that use
the same reference drug.
The Hatch-Waxman Act established a second abbreviated pathway, the so-called 505(b)(2)
pathway. This pathway has been used to approve some biological products under the FFDCA,
specifically follow-on natural source biologics that had received approval under the FFDCA
rather than licensure under the PHSA. In contrast to an ANDA, a 505(b)(2) NDA contains full
reports of investigations of safety and effectiveness, but at least some of the information relied
upon for approval comes from studies that were not conducted by or for the applicant and for
which the applicant has not obtained a right of reference. A 505(b)(2) NDA may rely on published
literature or on FDA’s finding of safety and effectiveness for the RLD.
The Hatch-Waxman Act provided a mechanism for the approval of generic drugs and certain
follow-on biologics under the FFDCA, but not for follow-on biologics or biosimilars under the
PHSA. As a result, after Hatch-Waxman, companies could submit so-called follow-on
applications (i.e., 505(b)(2) NDAs) for FDA review only for the small number of biologics that
had been approved under the FFDCA (e.g., insulin). Companies were effectively blocked from
submitting follow-on applications for the much larger group of therapeutic biologics that had
been licensed under the PHSA.
Insulin: Case Study of a Small Biologic
Insulin production has changed over the years as researchers have made alterations to the product that have
eased its use by patients. The original insulin, also called regular insulin, is a short-acting product with a duration of
action of about eight hours. In the late 1930s through the 1950s, regular insulin was altered by adding substances
to gain longer action; these are called intermediate-acting insulins. In 1982, recombinant DNA technology allowed
for the replacement of animal insulin by human insulin made by microorganisms in a laboratory fermentation
process. Over the past few decades, slight modifications of the insulin molecule—called insulin analogs—have been
developed. Long-acting insulin analogs, Lantus (insulin glargine) and Levemir (insulin detemir), entered the market
in the early 2000s. Rapid-acting insulin analogs Humalog (insulin lispro) and Novolog (insulin aspart) were
developed to allow for quicker absorption and shorter duration of action. As a result, there are now five types of
insulin products: long-acting, rapid-acting, intermediate-acting, short-acting (regular insulin), and premixed. The
price of certain insulin products has risen significantly. For example, from 2001 to 2015, the price of insulin lispro
increased 585% (from $35 to $234 per vial). One vial may last a patient less than two weeks.
Currently, three firms—Eli Lilly, Novo Nordisk, Sanofi Aventis—account for over 90% of the global market and
100% of the U.S. insulin market. An FDA analysis found that a drug’s price is directly affected by the number of
different companies marketing the drug. Because three firms make all the insulin used in this country, the market
behaves differently from the usual case in pharmaceutical markets where generic competition results in price
reductions. A 1995 analysis of Eli Lilly’s insulin production process found that the total cost involved in making
enough insulin to treat one patient per year was $33.60. A 2018 study calculated that a year's supply of human
insulin could be priced at $48 to $71 per person and analog insulins could be priced at between $78 and $133;
this amount would cover production costs and still deliver a profit to the manufacturer. How much profit is fair is
a large piece of the drug pricing puzzle. A 2017 Government Accountability Office (GAO) report found that the
average profit margin for the largest 25 drug companies—companies with the highest pharmaceutical and
biotechnology sales revenue in 2015—was 20% in 2015, compared with 6.7% for the largest 500 U.S. companies in
general. The three insulin manufacturers are among the largest 25 drug companies. For further details, see CRS In
Focus IF11026, Insulin Products and the Cost of Diabetes Treatment.
Even when patent protection for biological products was approaching expiration, the market
competition that occurred with chemical drugs via generics could not happen with therapeutic
biologics because FDA lacked clear regulatory authority to approve biosimilars. Although some
entities, such as the Generic Pharmaceutical Association (GPhA, now called the Association for
Accessible Medicines), advocated that the FDA establish a regulatory system for the approval of
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biosimilars under its existing statutory authority,25 the Biotechnology Industry Organization
(BIO) filed a citizen petition with the FDA requesting a number of actions that would have
inhibited the approval of biosimilars.26
In April 2006, the European Medicines Agency (EMA) authorized for marketing in Europe the
first biosimilar product, Omnitrope, a human growth hormone derived from recombinant DNA
processes. This was followed by the authorization of five other biosimilar products in 2007, two
more in 2008, and numerous others thereafter.27
In the United States, FDA approval of Omnitrope via the 505(b)(2) pathway was announced in
June 2006 following an April 10, 2006, ruling by the U.S. District Court for the District of
Columbia in favor of Omnitrope’s sponsor, Sandoz.28 The court ruled that the FDA must move
forward with consideration of the application, submitted by Sandoz in 2003, which presented
Omnitrope as “indistinguishable” from the FDA-approved Genotropin, marketed by Pfizer.
Sandoz “alleged that the FDA had violated its statutory obligation to act on the Omnitrope
application within 180 days, a time frame that the FDA characterized as merely a congressional
aspiration.”29
Omnitrope was not the first follow-on biologic approved through the abbreviated 505(b)(2)
pathway.30 However, scientific and regulatory uncertainty surrounding its approval may have
signaled to Congress that legislation was needed to allow for approval/licensure of follow-on
biologics under the PHSA. At the time of the Omnitrope approval in 2006, FDA indicated in a
document on the agency’s website that this action “does not establish a pathway” for approval of
other follow-on biologics. “The agency has said that Congress must change the law before it can
approve copies of nearly all other biotech products, and lawmakers haven’t moved on the
issue.”31
25 Bill Nixon, President and CEO, Generic Pharmaceutical Association, letter to Daniel Troy, Chief Counsel, FDA,
January 18, 2002, http://www.fda.gov/cder/ogd/GPHA_jan_21.htm.
26 BIO Citizen Petition, Follow-on Therapeutic Proteins, April 23, 2003, http://www.fda.gov/OHRMS/DOCKETS/
DOCKETS/03p0176/03p-0176-cp00001-01-vol11.pdf.
27 European Medicines Agency (EMA), European public assessment reports, available at https://www.ema.europa.eu/
en/human-regulatory/overview/biosimilar-medicines-overview.
28 Anna Wilde Mathews and Jeanne Whalen, “FDA Clears Copycat Version Of Human Growth Hormone,” The Wall
Street Journal, June 1, 2006, and Anna Wilde Mathews, “FDA Is Ordered to Rule on Generic Biotech Drug,” The Wall
Street Journal, April 15, 2006.
29 “Europe approves two follow-on human growth hormones,” Nature Biotechnology, vol. 24 (June 2006), p. 601.
30 FDA had approved via the 505(b)(2) pathways several other follow-on biologics: Fortical (calcitonin-salmon) nasal
spray, for treatment of postmenopausal osteoporosis, approved in August 2005; Hylenex (hyaluronidase-human), for
increasing absorption of an injected drug, approved in December 2005; and GlucaGen (glucagon recombinant for
injection), for recovery from insulin induced hypoglycemia, approved in June 1998. More recently, in December 2015,
FDA approved Basaglar under a 505(b)(2) NDA, relying in part, on FDA’s finding of safety and effectiveness for
Lantus (insulin glargine injection) to support approval. In its press release, FDA makes clear that Basaglar is not
approved as a generic. Basaglar also is not approved as a biosimilar, as there are no insulin glargine products that are
currently licensed under the PHSA, so there is no “reference product” for a proposed biosimilar product. See “Follow-
on Protein Products,” Testimony of Dr. Janet Woodcock before the House Committee on Oversight and Government
Reform, March 26, 2007, and “FDA approves Basaglar, the first ‘follow-on’ insulin glargine product to treat diabetes,”
December 16, 2015.
31 Anna Wilde Mathews and Jeanne Whalen, “FDA Clears Copycat Version Of Human Growth Hormone,” The Wall
Street Journal, June 1, 2006.
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Congressional Research Service 8
New Regulatory Pathway for Biosimilars
In March 2010, the BPCIA—enacted as Title VII of the ACA—established a new regulatory
authority for FDA by creating an abbreviated licensure pathway in Section 351(k) of the PHSA
for biological products that are demonstrated to be “highly similar” (biosimilar) to or
“interchangeable” with an FDA-licensed biological product. The ACA also directed FDA to
develop and present to Congress recommendations for a user fee program to support review of
biosimilar product applications submitted under Section 351(k) of the PHSA.32 The Biosimilar
User Fee Act of 2012 (BsUFA), enacted as Title IV of Food and Drug Administration Safety and
Innovation Act (FDASIA, P.L. 112-144), authorized FDA to assess and collect fees for
biosimilars (for additional information about the user fee legislation, see Appendix A).
Under Section 351(k) of the PHSA, a company interested in marketing a biosimilar product in the
United States must first submit to FDA an application that provides information demonstrating,
among other things, biosimilarity based on data from analytical studies (structural and functional
tests), animal studies (toxicity tests), and a clinical study or studies (tests in human patients). The
agency may decide, at its discretion, that a certain study or studies are unnecessary in a biosimilar
application.33 A biological product may be demonstrated to be “biosimilar” to the reference
product if data show that the product is “highly similar” to the reference product, notwithstanding
minor differences in clinically inactive components, and there are no clinically meaningful
differences between the biological product and the reference product in terms of safety, purity,
and potency.34
To be considered interchangeable with the reference product, the applicant must show that the
biologic is biosimilar to the reference product and that it can be expected to produce the same
clinical result as the reference product in any given patient. Additionally, for products
administered more than once, the applicant must demonstrate that “the risk in terms of safety or
diminished efficacy of alternating or switching between use of the biological product and the
reference product is not greater than the risk of using the reference product without such
alternation or switch.”35 Interchangeable products may be substituted for the reference product by
a pharmacist without the intervention of the prescribing health care provider.36 To date, FDA has
not approved any interchangeable products.
Because biologics are more complex than chemical drugs, both in composition and method of
manufacture, biosimilars will not be exact replicas of the brand-name product, but may instead be
shown to be highly similar. However, for many years, the drug industry and FDA have coped with
the inherent variability in biological products from natural sources. FDA maintains that the batch-
to-batch and lot-to-lot variability that occurs for both brand-name biologics and biosimilars can
be assessed and managed effectively.
Under the BPCIA, biologics that were approved as drugs under the FFDCA will transition to
biological licenses under the PHSA in March 2020—the so-called “deemed to be a license”
provision.37 This BPCIA provision affects the relatively small set of biological products that were
32 ACA §7002(f).
33 PHSA § 351(k)(2)(A).
34 PHSA § 351(i)(2).
35 PHSA § 351(k)(4).
36 FDA, Implementation of the Biologics Price Competition and Innovation Act of 2009, http://www.fda.gov/Drugs/
GuidanceComplianceRegulatoryInformation/ucm215089.htm.
37 BPCIA §7002(e).
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Congressional Research Service 9
approved under the FFDCA: hormone insulin, hormone glucagon, human growth hormone,
hormones to treat infertility, hormones used to manage menopause and osteoporosis, and certain
medical enzymes (hyaluronidase and urokinase). While the BPCIA requires that an NDA for a
biologic is deemed to be a BLA on the date that is 10 years after enactment (i.e., March 23, 2020),
the statute is silent on implementation. FDA released draft guidance regarding the agency’s
interpretation of this BPCIA provision in March 2016 and final guidance in December 2018.38
In FDA’s interpretation, as of March 23, 2020, applications for biological products that were
approved under the FFDCA will no longer exist (as NDAs or ANDAs) and will be replaced by
approved BLAs under the PHSA. In addition, FDA will not approve any application under the
FFDCA for a biological product subject to the transition provisions that is still pending as of
March 23, 2020. The FDA suggests that such applications be withdrawn and resubmitted under
the PHSA, either under section 351(a) (a full BLA) or 351(k) (a BLA for a biosimilar or
interchangeable biological product).
To balance competition and innovation, the BPCIA established two periods of exclusivity
applicable to a brand-name biologic (i.e., the reference product)—one with a duration of 4 years
and the other with a duration of 12 years.39 Periods of regulatory exclusivity attach upon approval
or licensure of a drug or biologic, respectively, if certain statutory requirements are met, limiting
the ability of competitors to reference the data generated by brand-name drug manufacturers.
During the four-year exclusivity period, a BLA for a biosimilar or interchangeable product
referencing the brand-name biologic may not be submitted to FDA. During the 12-year
exclusivity period, approval of a BLA for a biosimilar or interchangeable product referencing the
brand-name biologic may not be made effective. This means that FDA may not approve a BLA
for a biosimilar or interchangeable product until 12 years after the date on which the reference
product was first licensed, and a BLA for a biosimilar or interchangeable product cannot be
submitted to FDA until four years after the date on which the reference product was licensed.
Certain biologics are not eligible for the reference product exclusivity, for example, if an
application is for a minor change to a previously licensed biologic.40 A new biologic may be
eligible for an additional 6-month period of exclusivity that would attach to the 12- and 4-year
periods if the applicant conducts pediatric studies pursuant to a written request from FDA.41
Additionally, a biologic approved to treat a rare disease or condition may be granted seven years
of orphan drug exclusivity for the protected indication, in which case FDA may not license
another biologic for the protected orphan indication until after the expiration of the 7-year or 12-
year exclusivity period, whichever is later.42 While the first biosimilar for a brand-name is not
eligible for exclusivity, the first interchangeable product is. This means that FDA will not make
an interchangeability determination for a subsequent biologic relying on the same reference
product for any condition of use until such exclusivity expires. 43 The periods of exclusivity
available for biological products under the PHSA are generally longer than those for chemical
38 FDA, Interpretation of the “Deemed to be a License” Provision of the Biologics Price Competition and Innovation
Act of 2009 Guidance for Industry, December 2018, https://www.fda.gov/downloads/Drugs/
GuidanceComplianceRegulatoryInformation/Guidances/UCM490264.pdf.
39 PHSA § 351(k)(7).
40 PHSA § 351(k)(7)(C).
41 PHSA § 351(m).
42 FFDCA §527(a). See also FDA, “Guidance for Industry Reference Product Exclusivity for Biological Products Filed
Under Section 351(a) of the PHS Act,” August 2014, https://www.fda.gov/downloads/drugs/
guidancecomplianceregulatoryinformation/guidances/ucm407844.pdf.
43 PHSA § 351(k)(6).
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Congressional Research Service 10
drugs under the FFDCA (i.e., five-year new chemical entity exclusivity, three-year new clinical
study exclusivity).
Transitional biological products will not be eligible for the 12-year biologics exclusivity period
because they were not first licensed under the PHSA, as specified by the BPCIA. In guidance,
FDA states, “[n]othing in the BPCI Act suggests that Congress intended for biological products
approved under section 505 of the FD&C Act—some of which were approved decades ago—to
obtain a 12-year period of reference product exclusivity upon being deemed to be licensed under
section 351(a) of the PHS Act.” 44
Additionally, according to FDA guidance, any unexpired period of exclusivity associated with an
approved NDA for a biologic subject to the transition would cease to have any effect.45 This
would include the five-year new chemical entity exclusivity awarded to a drug whose active
ingredient FDA has not previously approved, as well as the three-year new clinical study
exclusivity, which may be awarded with respect to an NDA or supplemental NDA for a
previously approved active ingredient (e.g., for a change in route of administration or new
indication). For example, Sanofi, the manufacturer of the insulin Admelog, would lose almost 9
months of Hatch-Waxman exclusivity in the transition (Admelog’s exclusivity expires on
December 11, 2020).46 Any unexpired periods of orphan drug exclusivity would continue to apply
for the protected indication after March 23, 2020, as orphan drug exclusivity can block the
approval of a drug approved under the FFDCA or a biologic licensed under the PHSA. Similarly,
any unexpired pediatric exclusivity associated with an approved NDA for a biologic would
continue to apply to a deemed BLA after March 23, 2020.47
Approval and Marketing of Biosimilars The biosimilars market is still developing and while less than 2% of Americans use biologics,
these products represent 40% of total spending on prescription drugs.48 As of May 29, 2019, FDA
has approved a total of 19 biosimilars for 9 reference products as shown in Table 2.
44 FDA, Interpretation of the “Deemed to be a License” Provision of the Biologics Price Competition and Innovation
Act of 2009 Guidance for Industry, December 2018, pp. 9-10, https://www.fda.gov/downloads/Drugs/
GuidanceComplianceRegulatoryInformation/Guidances/UCM490264.pdf.
45 Ibid.
46 Sue Sutter, “Sanofi’s Admelog, a Humalog Follow-On, Approved in US As ‘Black Hole’ for Insulin Looms,” Pink
Sheet, December 18, 2017.
47 FDA, Interpretation of the “Deemed to be a License” Provision of the Biologics Price Competition and Innovation
Act of 2009 Guidance for Industry, December 2018, p. 7, https://www.fda.gov/downloads/Drugs/
GuidanceComplianceRegulatoryInformation/Guidances/UCM490264.pdf.
48 FDA Statement, “Remarks from FDA Commissioner Scott Gottlieb, M.D., as prepared for delivery at the Brookings
Institution on the release of the FDA’s Biosimilars Action Plan,” July 18, 2018, https://www.fda.gov/newsevents/
newsroom/pressannouncements/ucm613881.htm.
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Table 2. Biosimilars Approved for Marketing in the United States by FDA
Reference
Product
Nonproprietary
Name
Biosimilar
(Marketer, approval date)
Nonproprietary
Name
Neupogen filgrastim Zarxio (Sandoz, March 2015)
Nivestym (Pfizer, July 2018)
filgrastim-sndz
filgrastim-aafi
Remicade infliximab Inflectra (Celltrion/Pfizer, April 2016)
Renflexis (Samsung/Merck, April 2017)
Ixifi (Pfizer, December 2017)
infliximab-dyyb
infliximab-abda
infliximab-qbtx
Enbrel etanercept Erelzi (Sandoz, August 2016)
Eticovo (Samsung, April 2019)
etanercept-szzs
etanercept-ykro
Humira adalimumab Amjevita (Amgen, September 2016)
Cyltezo (Boehringer Ingelheim, August 2017)
Hyrimoz (Sandoz, October 2018)
adalimumab-atto
adalimumab-adbm
adalimumab-adaz
Avastin bevacizumab Mvasi (Amgen, September 2017) bevacizumab-
awwb
Herceptin trastuzumab Ogivri (Mylan, December 2017)
Herzuma (Celltrion, December 2018)
Ontruzant (Samsung, January 2019)
Trazimera (Pfizer, March 2019)
trastuzumab-dkst
trastuzumab-pkrb
trastuzumab-dttb
trastuzumab-qyyp
Epogen/
Procrit
epoetin Retacrit (Hospira/Pfizer, May 2018) epoetin alfa-epbx
Neulasta pegfilgrastim Fulphila (Mylan, June 2018)
Udenyca (Coherus Bioscience, November 2018)
pegfilgrastim-jmdb
pegfilgrastim-cbqv
Rituxan rituximab Truxima (Celltrion, November 2018) rituximab-abbs
Sources: FDA, Biosimilar Product Information, accessed May 29, 2019 https://www.fda.gov/Drugs/
DevelopmentApprovalProcess/HowDrugsareDevelopedandApproved/ApprovalApplications/
TherapeuticBiologicApplications/Biosimilars/ucm580432.htm.
Although FDA has licensed 19 biosimilars for marketing in the United States, many of these
products are not yet available to patients, primarily due to ongoing litigation and settlement
agreements. However, even once a biosimilar is launched, additional factors have been identified
as potentially limiting biosimilar competition. These factors, which are described in greater detail
below, include biosimilar naming and labeling conventions; interchangeability requirements; and
access to samples for biosimilars testing. FDA has attempted to address some of these factors in
its Biosimilars Action Plan, which was issued in July 2018.49 Other factors, such as exclusive
contracts with insurers, rebates to payors, and reimbursement policies also have been identified as
impeding biosimilar uptake, but are outside the scope of this report.
Patent Litigation and Settlements
The launch of several biosimilar products has been delayed due to ongoing patent litigation and
settlements between brand biologic and biosimilar companies. For example, AbbVie has been the
subject of Congressional inquiry for its use of a so-called “patent thicket” to protect its biologic
49 FDA, “Biosimilar Action Plan: Balancing Innovation and Competition,” July 2018, https://www.fda.gov/media/
114574/download.
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service 12
Humira (adalimumab) from biosimilar competition.50 According to one analysis, AbbVie filed
247 patent applications with respect to Humira and was issued 132 patents.51 Humira was initially
licensed in the United States in 2002. Although FDA has approved three biosimilar versions of
the product—Amgen’s Amjevita, Boehringer Ingelheim’s Cyltezo, and Sandoz’s Hyrimoz—none
of these are currently available to U.S. patients. AbbVie has reportedly settled patent lawsuits
with several companies to delay biosimilar versions of Humira from becoming available in the
United States until 2023 (see Table 3).52
Table 3. Settlement Agreements Between AbbVie and Competitors
Settlement agreements addressing launch of Humira and biosimilar competitors
Competitor Biosimilar licensed by FDA?
U.S. licensure date per
settlement
Amgen Yes—Amjevita on September 23, 2016 January 31, 2023
Samsung Bioepis No June 30, 2023
Boehringer Ingelheim Yes—Cyltezo on August 25, 2017 July 1, 2023
Mylan No July 31, 2023
Sandoz Yes—Hyrimoz on October 30, 2018 September 30, 2023
Fresenius Kabi No September 30, 2023
Momenta No November 20, 2023
Pfizer No November 20, 2023
Source: AbbVie, News Center, accessed May 16, 2019, https://news.abbvie.com/news/press-releases/.
Notes: Table created by CRS based on AbbVie press releases and the FDA Purple Book.
Under Title XI of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(MMA; P.L. 108-173), certain settlement agreements between brand and generic drug companies
must be filed with the Federal Trade Commission (FTC) and Department of Justice (DOJ). The
Patient Right to Know Drug Prices Act (P.L. 115-263) amended MMA Title XI, expanding these
reporting requirements to include agreements between biosimilar product applicants and brand
biologic companies, as well as agreements between two biosimilar product applicants. Section
4004 of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment
for Patients and Communities Act (P.L. 115-271; the SUPPORT for Patients and Communities
50 “This term is used in two slightly different ways, both relating to products with a high number of patents. First, a
patent thicket may describe the situation where multiple parties have overlapping patent rights on one product, such
that a ‘potential manufacturer must negotiate licenses with each patent owner in order to bring a product to market
without infringing.’ Patent thickets, in this sense, raise concerns about inefficient exploitation of a technology because
the multiplicity of owners increases transaction costs and creates coordination challenges. Second, the term may be
used in a looser sense to describe an incumbent manufacturer’s practice of amassing of a large volume of patents
relating to a single product, with the intent to intimidate follow-on competitors from entering the market (or to make it
too costly and risky to do so). AbbVie’s Humira patent portfolio has been alleged to be an example of this sort of patent
thicket,” see CRS Report R45666, Drug Pricing and Intellectual Property Law: A Legal Overview for the 116th
Congress.
51 Initiative for Medicines, Access, and Knowledge (I-MAK), “Overpatented, Overpriced: How Excessive
Pharmaceutical Patenting is Extending Monopolies and Driving up Drug Prices,” p. 7, see https://www.i-mak.org/wp-
content/uploads/2018/08/I-MAK-Overpatented-Overpriced-Report.pdf.
52 Ed Silverman, “Behind the patent thicket: tactics AbbVie allegedly used to thwart biosimilar versions of Humira,
STAT, November 7, 2018, https://www.statnews.com/pharmalot/2018/11/07/abbvie-biosimilars-humira-patents/.
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service 13
Act) amended MMA Title XI, further expanding reporting requirements between biologic
manufacturers and biosimilar product applicants.
Some concern has been raised about a lack of transparency surrounding patents for biologics and
“patent thickets that are purely designed to deter the entry of approved biosimilars.”53 For drugs
approved under the FFDCA, pursuant to the Hatch-Waxman Act, a drug manufacturer must list as
part of its NDA any patents that claim the drug that is the subject of the NDA or the method of
using that drug.54 FDA then publishes this information in the Approved Drug Products with
Therapeutic Equivalence Evaluations, more commonly known as the Orange Book.55 The Orange
Book satisfies the statutory requirement that FDA make publicly available, and revise every 30
days, a list of drugs that have been approved for safety and effectiveness and any patent
information submitted with respect to such drugs.56 When a generic company submits an ANDA
referencing a listed drug (typically the brand-name drug), it must provide a certification with
respect to each patent listed in the Orange Book for that drug.57 The Orange Book also lists any
unexpired periods of exclusivity covering an approved drug, in addition to other information
applicants may find helpful.58
The PHSA, as amended by the BPCIA, does not require manufacturers of biologics to list patent
information as part of a BLA, and the patent resolution scheme is different for biologics and
biosimilars than for chemical drugs under Hatch-Waxman. The BPCIA provides for “an elaborate
process for disclosure and negotiation, sometimes referred to as the ‘patent dance.’ The ‘dance’
generally involves an applicant and reference product sponsor participating in a series of
informational exchanges regarding potential disputes over patent validity and infringement.”59
Also in contrast to Hatch-Waxman, approval of a biosimilar under the BPCIA is not contingent
upon resolution of patent disputes. As such, FDA may approve a biosimilar despite unresolved
patent issues.
While FDA is not required by law to publish information about approved biologics and
biosimilars, the agency does so voluntarily with the publication of the Purple Book. Unlike the
Orange Book, which is available in paper form and as a searchable, electronic database, the
Purple Book consists of two lists—one for biological products (including biosimilar and
interchangeable products) licensed by CDER and the other for those licensed by CBER.60 For
brand-name biologics, the list identifies the date the biologic was licensed (i.e., approved), and if
53 FDA Statement, “Remarks from FDA Commissioner Scott Gottlieb, M.D., as prepared for delivery at the Brookings
Institution on the release of the FDA’s Biosimilars Action Plan,” July 18, 2018, https://www.fda.gov/newsevents/
newsroom/pressannouncements/ucm613881.htm.
54 FFDCA § 505(b)(1).
55 FDA, Orange Book: Approved Drug Products with Therapeutic Equivalence Evaluations,
https://www.accessdata.fda.gov/Scripts/cder/ob/index.cfm.
56 FFDCA § 505(j)(7)(A). See also the Orange Book Preface, available at https://www.fda.gov/Drugs/
DevelopmentApprovalProcess/ucm079068.htm.
57 FFDCA § 505(j)(2)(A)(vii). For additional information about the patent certification procedures, see CRS Report
R44643, The Hatch-Waxman Act: A Primer.
58 FDA, Orange Book Preface, available at https://www.fda.gov/Drugs/DevelopmentApprovalProcess/ucm079068.htm.
59 CRS Legal Sidebar WSLG1796, UPDATE: Battle Over Biosimilars: The Supreme Court Considers Dueling
Interpretations of the ACA’s Biologics Price Competition and Innovation Act Provisions. For additional information
about the biologics patent dance, see CRS Report R45666, Drug Pricing and Intellectual Property Law: A Legal
Overview for the 116th Congress.
60 FDA, “Purple Book: Lists of Licensed Biological Products with Reference Product Exclusivity and Biosimilarity or
Interchangeability Evaluations,” https://www.fda.gov/drugs/developmentapprovalprocess/
howdrugsaredevelopedandapproved/approvalapplications/therapeuticbiologicapplications/biosimilars/ucm411418.htm.
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Congressional Research Service 14
FDA evaluated the product for reference product exclusivity, the date the exclusivity will expire.
FDA has not made a determination of the date of first licensure for all biologics. According to the
agency, a determination of the date of first licensure and product exclusivity expiration “will
generally be made for reasons of regulatory necessity and/or at the request of the [BLA] license
holder.”61 The CDER and CBER lists also cross-reference the names of brand-name biologics
licensed with the names of licensed biosimilar products.
In FDA’s July 2018 “Biosimilars Action Plan,” the agency said it would enhance the Purple Book
to include more information about approved biologics.62 FDA also requested comments from the
public on what steps the agency could take, within its statutory authority, related to biologics,
including “additional information or features [that] could be incorporated into the Purple Book to
make it more useful to stakeholders, including patients, healthcare providers, pharmacists, and
manufacturers[.]”63 Commenters proposed that FDA should include more comprehensive
information about biologics;64 publish prompt reference product exclusivity decisions at the time
of biologic approval;65 update the Purple Book to clarify which products have been determined
not to have exclusivity and those that are still subject to pending decisions;66 and to make the
Purple Book into a single searchable electronic database (e.g., more like the Orange Book).67
Commenters noted that amending the Purple Book to list patent information would require a
change in statute and, potentially, a change to the patent resolution scheme. In the 116th Congress,
bipartisan legislation has been introduced that would codify the publication of the Purple Book as
a single searchable list and would require additional information to be published, including
information about patents that claim the biologic or other patentable inventions relating to the
biologic, thus providing more patent transparency and potentially promoting biosimilar
competition.68
Naming
Even once patent litigation is resolved and a biosimilar is marketed, one factor that has been
identified as potentially impacting uptake of launched biosimilars is FDA’s proposed naming
61 FDA, “Background Information: Lists of Licensed Biological Products with Reference Product Exclusivity and
Biosimilarity or Interchangeability Evaluations (Purple Book),” https://www.fda.gov/Drugs/
DevelopmentApprovalProcess/HowDrugsareDevelopedandApproved/ApprovalApplications/
TherapeuticBiologicApplications/Biosimilars/ucm411424.htm.
62 FDA, “Biosimilars Action Plan: Balancing Innovation and Competition,” July 2018, https://www.fda.gov/
downloads/Drugs/DevelopmentApprovalProcess/HowDrugsareDevelopedandApproved/ApprovalApplications/
TherapeuticBiologicApplications/Biosimilars/UCM613761.pdf.
63 FDA, “Facilitating Competition and Innovation in the Biological Products Marketplace; Public Hearing; Request for
Comments,” FDA-2018-N-2689 https://www.regulations.gov/docketBrowser?rpp=25&so=DESC&sb=
commentDueDate&po=25&dct=PS&D=FDA-2018-N-2689.
64 The Academy of Managed Care Pharmacy, Re: Facilitating Competition and Innovation in the Biological Products
Marketplace; Public Hearing; Request for Comments, September 21, 2018.
65 The Pharmaceutical Research and Manufacturers of America (PhRMA), Re: Docket No. FDA-2018-N-2689:
Facilitating Competition and Innovation in the Biological Products Marketplace; Public Hearing; Request for
Comments, September 21, 2018.
66 Comments from The Association for Accessible Medicines (AAM) and the Biosimilars Council on behalf of our
member companies, regarding Docket FDA-2018-N-2689, Facilitating Competition and Innovation in the Biological
Products Marketplace, Public Hearing; Request for Comments, September 21, 2018.
67 Ibid. The Academy of Managed Care Pharmacy, Re: Facilitating Competition and Innovation in the Biological
Products Marketplace; Public Hearing; Request for Comments, September 21, 2018.
68 For example, S. 659 in the 116th Congress.
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service 15
scheme, specifically in regard to the nonproprietary name of the biosimilar compared to the
reference product. The nonproprietary name, or proper name, is used in the product’s labeling,
regulation, and scientific literature to identify a pharmaceutical substance or active
pharmaceutical ingredient. For chemical drugs, the nonproprietary name is also known as the
generic name. This is in contrast to the proprietary name of a drug or biologic, which is the
trademarked name, or brand name. It is the name a company uses to market its drug product, and
it is usually capitalized, followed by a superscript R in a circle (®). For example, Neupogen® is
the proprietary name for filgrastim, the nonproprietary name for the active substance.
FDA released draft guidance on the nonproprietary naming of biological products in August
2015; this guidance was finalized on January 12, 2017.69 In March 2019, FDA issued a revised
draft guidance.70 The agency intends to ultimately issue a revised, final version of the 2017
naming guidance incorporating comments on the 2019 draft guidance.71 According to the naming
convention outlined in the January 2017 guidance, “the nonproprietary name designated for each
originator biological product [i.e., the reference product], related biological product, and
biosimilar product will be a proper name that is a combination of the core name and a
distinguishing suffix that is devoid of meaning and composed of four lowercase letters.”72 The
core name refers to the component shared among an originator biological product and any related
biological, biosimilar, or interchangeable product as part of the proper name.73 An example of a
core name is filgrastim. The suffix is attached to the core name with a hyphen as a unique
identifier, for example, filgrastim-xzwy. This naming convention was to be applied to previously
licensed and prospective biologics and biosimilars.
In the March 2019 revised draft guidance, FDA stated that it no longer intends to modify the
proper names of biologics that were previously licensed under the PHSA without an FDA-
designated suffix in their proper names. The agency also does not intend to apply the naming
convention to transition biologics (e.g., insulin).74 Instead, FDA will apply the naming convention
to biological products at the time they are licensed. This is in contrast to the approach outlined in
the agency’s 2017 naming guidance, which would have applied this naming convention to
previously licensed biologics, as well. For interchangeable products, in the revised guidance,
FDA determined that a unique suffix that distinguishes an interchangeable product from other
products sharing the same core name would be appropriate.75
In general, the biosimilars industry seems to support the shared use of a nonproprietary name,
whereas those advocating for the innovator companies prefer a naming scheme that distinguishes
69 FDA, Nonproprietary Naming of Biological Products: Guidance for Industry, January 2017, https://www.fda.gov/
downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM459987.pdf.
70 FDA, Nonproprietary Naming of Biological Products: Update, Draft Guidance, March 2019, https://www.fda.gov/
downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM632806.pdf.
71 FDA, “Statement from FDA Commissioner Scott Gottlieb, M.D., on FDA’s steps on naming of biological medicines
to balance competition and safety for patients receiving these products,” March 7, 2019, https://www.fda.gov/
NewsEvents/Newsroom/PressAnnouncements/ucm632870.htm.
72 FDA, Nonproprietary Naming of Biological Products: Guidance for Industry, January 2017, p. 1, at
https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM459987.pdf
73 Nonproprietary names are selected by the USAN Council according to principles developed to ensure safety,
consistency, and logic in the choice of names. For information on the USAN Council, see http://www.ama-assn.org/
ama/pub/physician-resources/medical-science/united-states-adopted-names-council.page.
74 FDA, Nonproprietary Naming of Biological Products: Update, Draft Guidance, March 2019, p. 5,
https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM632806.pdf.
75 FDA, Nonproprietary Naming of Biological Products: Update, Draft Guidance, March 2019, https://www.fda.gov/
downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM632806.pdf.
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between the reference biologic product and the biosimilar.76 In its October 2015 public comments
to FDA, the Federal Trade Commission (FTC) expressed concern that the FDA’s naming
proposal assigning unique differentiating suffixes “could result in physicians incorrectly believing
that biosimilars’ drug substances differ in clinically meaningful ways from their reference
biologics’ drug substances.”77 This “misperception” could “deter physicians from prescribing
biosimilars” thereby “impeding the development of biosimilar markets and competition.”78 FTC
reiterated these concerns in its May 2019 public comments on FDA’s March 2019 draft guidance,
stating that “[t]his unusual naming convention—applied exclusively to a subset of new entrants—
likely would create consumer confusion and discourage use of newly introduced biosimilar and
interchangeable products.”79
Biosimilars Labeling
Another factor that has been identified as potentially impacting uptake of launched biosimilars is
FDA’s policy on biosimilar labeling, specifically the recommendation for inclusion of a
biosimilarity statement. The labeling for a prescription drug product conveys information about
the product’s safety and effectiveness to a health care provider, allowing the provider to decide if
the product is appropriate for a particular patient. In 2006, FDA issued a final rule on the content
and format of labeling for prescription drug products, including biological products.80 FDA
requires that labeling begin with a highlights section that includes any warnings about the drug.
Other FDA-required elements of labeling include indications and usage, dosage and
administration, dosage forms and strengths, contraindications, warnings and precautions, adverse
reactions, drug interactions, use in specific populations, drug abuse and dependence, overdosage,
clinical pharmacology, nonclinical toxicology, clinical studies, references, how supplied/storage
and handling, and patient counseling information.
FDA released draft guidance on biosimilar labeling in March 2016 and final guidance in July
2018.81 FDA recommends that the highlights section of the labeling contain a “Biosimilarity
Statement” describing the biosimilar product’s relationship to its reference product. For example,
“NIVESTYM (filgrastim-aafi) is biosimilar* to NEUPOGEN (filgrastim),” followed by the
statement:
76 Erin Durkin, “WHO Unveils Final Biological Naming Plan That Differs From FDA’s,” InsideHealthPolicy’s FDA
Week, January 29, 2016.
77 Comment of the Staff of the Federal Trade Commission, Submitted to the Food and Drug Administration, In
Response to a Request for Comments on Its Guidance for Industry on the “Nonproprietary Naming of Biological
Products; Draft Guidance for Industry; Availability” [Docket No. FDA-2013-D-1543] Submitted on October 27, 2015,
p. 2, https://www.ftc.gov/system/files/documents/advocacy_documents/ftc-staff-comment-submitted-food-drug-
administration-response-fdas-request-comments-its-guidance/151028fdabiosimilar.pdf.
78 Ibid.
79 Comment of the Staff of the Federal Trade Commission, In Response to a Request for Comments on FDA’s
Guidance for Industry on the “Nonproprietary Naming of Biological Products; Draft Guidance for Industry; Update”
[Docket No. FDA-2013-D-1543] 84 Fed Reg. 8534 (Mar. 8, 2019) Submitted on May 6, 2019, https://www.ftc.gov/
system/files/documents/advocacy_documents/ftc-staff-comment-fda-department-health-human-services-its-updated-
guidance-industry-nonproprietary/ftc_comment_to_fda_2019_biologics_naming_guidance_5-6-19.pdf.
80 FDA, “[Docket No. 2000N–1269] (formerly Docket No. 00N–1269) RIN 0910–AA94, Requirements on Content and
Format of Labeling for Human Prescription Drug and Biological Products,” Federal Register, vol. 71, no. 15, January
24, 2006, pp. 3922-3997, http://www.gpo.gov/fdsys/pkg/FR-2006-01-24/pdf/06-545.pdf.
81 FDA, Labeling for Biosimilar Products: Guidance for Industry, Guidance, July 2018, http://www.fda.gov/
downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM493439.pdf.
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* Biosimilar means that the biological product is approved based on data demonstrating
that it is highly similar to an FDA-approved biological product, known as a reference
product, and that there are no clinically meaningful differences between the biosimilar
product and the reference product. Biosimilarity of [BIOSIMILAR PRODUCT’S
PROPRIETARY NAME] has been demonstrated for the condition(s) of use (e.g.,
indication(s), dosing regimen(s)), strength(s), dosage form(s), and route(s) of
administration described in its Full Prescribing Information.
Some stakeholders have expressed opposition to the biosimilarity statement, noting that it “could
create needless confusion for patients,” and that this statement “does not serve a practical
function.”82
The biosimilar product is not required by FDA to have the same labeling as the reference product;
for example, the number of approved indications for use may differ. FDA recommends that
comparative data demonstrating biosimilarity not be included in biosimilar product labeling “to
avoid potential confusion or misinterpretation of the comparative data.”83 However, such
comparative data are available to prescribers and the public on the FDA website.84 Comments on
the FDA labeling guidance reflected differing views: while the generic industry wants less
information in biosimilar labeling, the brand-name industry would like FDA to require more
information.85 In contrast, the Biotechnology Innovation Organization (BIO), which represents
makers of brand-name biologics, stated that more information is preferable to less with regard to
labeling. “The prescribing physician needs to have access to all relevant information, including
the relevant nonclinical and clinical data supporting the finding of biosimilarity, and the resulting
labeling should be transparent to allow the prescriber to identify whether the described studies
were conducted with the biosimilar or reference product.”86
Interchangeability and Substitution
Another factor that may affect uptake of biosimilars is that a biosimilar generally cannot be
automatically substituted for the reference product (i.e., brand-name biologic) at the pharmacy-
level unless it is determined to be interchangeable with the reference product. An interchangeable
product “can be expected to produce the same clinical result as the reference product in any given
patient and, for a biological product that is administered more than once, that the risk of
alternating or switching between use of the biosimilar product and the reference product is not
greater than the risk of maintaining the patient on the reference product. Interchangeable products
may be substituted for the reference product by a pharmacist without the intervention of the
prescribing health care provider.”87 In January 2017, FDA released draft guidance on
interchangeability, and final guidance on May 10, 2019.88 FDA has not yet approved an
interchangeable product.
82 American Pharmacists Association (APhA), Re: Labeling for Biosimilar Products; Draft Guidance for Industry
[Docket No. FDA2016-D-0643-0001], August 2, 2016.
83 FDA, Drugs, From our perspective: Biosimilar product labeling, http://www.fda.gov/Drugs/NewsEvents/
ucm493240.htm.
84 Ibid.
85 Bronwyn Mixter, “Brand, Generic Groups Differ on Biosimilar Labeling,” Bloomberg BNA Health Care Daily
Report, June 7, 2016.
86 Ibid.
87 FDA, Implementation of the Biologics Price Competition and Innovation Act of 2009, http://www.fda.gov/Drugs/
GuidanceComplianceRegulatoryInformation/ucm215089.htm.
88 FDA, Considerations in Demonstrating Interchangeability With a Reference Product, Guidance, May 2019,
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As mentioned previously, a generic drug generally is considered to be interchangeable with its
reference (brand-name) drug and with other generic products that use the same reference drug.
All states have enacted laws that allow or require a pharmacist to substitute a generic for the
reference drug. Following passage of the Hatch-Waxman Act, one major source of cost saving
was the ability of a pharmacist to substitute a generic drug for a brand-name drug without the
intervention of a health care provider. However, because a biosimilar is not structurally identical
to its brand-name biologic, assessing interchangeability is a separate process.
In the United States, FDA regulates the drug product but the states regulate pharmacies and the
practice of pharmacy. According to the National Conference of State Legislatures (NCSL), as of
October 22, 2018 “at least 49 states have considered legislation establishing state standards for
substitution of a biosimilar prescription product to replace an original biologic product.”89 NCSL
indicates that a total of 45 states and Puerto Rico have enacted legislation; the provisions of state
legislation vary.90
Sample Sharing and Biosimilars Development
Another factor that may affect biosimilar competition is access to samples of the reference
product for purposes of biosimilar testing and development. As aforementioned, before a
company may market a biosimilar, it must demonstrate that its product is highly similar to a
reference product. Such comparative testing generally necessitates access to samples of a
reference product.91 FDA has reported receiving numerous inquiries from biosimilar product
developers indicating that they would like to develop a biosimilar version of a marketed drug, but
are unable to obtain the necessary samples of a reference product. Some brand-name companies
have implicated FDA-mandated safety programs—risk evaluation and mitigation strategies or
REMS—for why they are not willing to sell samples to the biosimilar product developer,
including that generic product developers may not ensure the safe use of these drugs, and that the
brand company could be held liable.92 A REMS-restricted distribution program controls or limits
the chain of supply to ensure drug safety. For biologics not subject to a REMS, companies have
implemented self-imposed restricted distribution systems. By withholding access to samples, a
brand-name company is generally able to prevent or delay a biosimilar product developer from
conducting the required testing and submitting an application to FDA for review.
In December 2018, FDA announced that it would start focusing on “these same potentially
anticompetitive practices” as it already has with chemical drugs.93 For example, for chemical
drugs, in December 2014, FDA issued draft guidance outlining the steps that a generic developer
https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM537135.pdf.
89 Richard Cauchi, “State Laws and Legislation Related to Biologic Medications and Substitution of Biosimilars,”
NCSL, October 22, 2018, http://www.ncsl.org/research/health/state-laws-and-legislation-related-to-biologic-
medications-and-substitution-of-biosimilars.aspx.
90 Ibid. Alabama, Arkansas, Maine, Mississippi, Oklahoma, and the District of Columbia have not enacted such
legislation.
91 CRS Report R44810, FDA Risk Evaluation and Mitigation Strategies (REMS): Description and Effect on Generic
Drug Development.
92 D. Tucker, G. Wells, & M Sheer, “REMS: The Next Pharmaceutical Enforcement Priority?” Antitrust, Vol. 28, No.
2, Spring 2014. © 2014 by the American Bar Association, https://www.morganlewis.com/news/2014/03/~/media/files/
docs/2014/rems-the-next-pharmaceutical-enforcement-priority.ashx.
93 FDA, “Statement from FDA Commissioner Scott Gottlieb, M.D., on new actions advancing the agency’s biosimilars
policy framework,” December 11, 2018, see https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/
ucm628121.htm.
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should take to obtain a letter from FDA to the brand company, indicating that its proposed testing
protocol is comparably as safe as the brand company’s REMS, and that it would not be a
violation of the REMS to provide the product samples for such testing.94 FDA announced that it
would set up a similar system for biosimilar product developers, although FDA cannot compel a
company to sell samples to another sponsor. Additionally, for chemical drugs, FDA has published
on its website a list of products for which it has received sample access inquiries related to
limited distribution of the brand drug.95 It is not clear whether FDA will publish a similar list for
biosimilar product inquiries. Out of the 76 approved REMS, 15 cover BLAs.96 However, the
agency said it was evaluating how it could make it easier for biosimilar product developers to use
reference products from outside the U.S. where they may be cheaper and more accessible.97
Additionally, legislation has been introduced that would aim to keep brand companies from using
REMS and non-REMS restricted distribution systems to prevent or delay biosimilars (and generic
drugs) from entering the market.98
Federal Research and Biologics Development The high costs of pharmaceuticals in general—and biologics in particular—has led to an
increased interest in understanding the federal government’s role in the development of costly
new therapeutics. In the case of many biosimilars approved by FDA, the associated brand-name
biologic (i.e., the reference product) was originally discovered by scientists at public-sector
research institutions. These brand-name biologics—for example, Remicade, Enbrel, Humira,
Avastin—are among the top-selling drugs in the United States and worldwide.
In general, the federal government—through the work conducted or supported by NIH—tends to
focus more on basic or preclinical research and the pharmaceutical industry concentrates more of
its research funding on clinical trials rather than on discovery activity.99 When trying to assign
credit for specific therapeutic advancements, drawing a line between basic and applied research
can be challenging. For example, without a major underlying advance, like recombinant DNA,
the development of whole new classes of drugs would not have occurred.
Various studies have attempted to quantify the contribution of publicly funded research to the
discovery of new drugs. A study published in 2003 found that of the 284 new drugs approved by
94 FDA “How to Obtain a Letter from FDA Stating that Bioequivalence Study Protocols Contain Safety Protections
Comparable to Applicable REMS for RLD Guidance for Industry,” Draft Guidance, December 2014,
https://www.fda.gov/downloads/drugs/guidancecomplianceregulatoryinformation/guidances/ucm425662.pdf.
95 FDA, “Reference Listed Drug (RLD) Access Inquiries,” https://www.fda.gov/Drugs/DevelopmentApprovalProcess/
HowDrugsareDevelopedandApproved/ApprovalApplications/AbbreviatedNewDrugApplicationANDAGenerics/
ucm607738.htm.
96 FDA, “Approved Risk Evaluation and Mitigation Strategies (REMS),” accessed March 15, 2019,
https://www.accessdata.fda.gov/Scripts/Cder/Rems/index.cfm.
97 FDA, “Statement from FDA Commissioner Scott Gottlieb, M.D., on new actions advancing the agency’s biosimilars
policy framework,” December 11, 2018, see https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/
ucm628121.htm. See also, FDA, “Biosimilars Action Plan: Balancing Innovation and Competition,” July 2018,
https://www.fda.gov/downloads/Drugs/DevelopmentApprovalProcess/HowDrugsareDevelopedandApproved/
ApprovalApplications/TherapeuticBiologicApplications/Biosimilars/UCM613761.pdf.
98 See, for example, the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act of 2019 (S. 340,
H.R. 965). For additional information about the CREATES Act, see CRS Legal Sidebar LSB10272, The CREATES Act
of 2019 and Lowering Drug Prices: Legal Background & Overview.
99 Hamilton Moses, David H.M. Matheson, Sarah Cairns-Smith, et al., “The Anatomy of Medical Research: U.S. and
International Comparisons,” JAMA, vol. 313, no. 2 (January 13, 2015), pp. 174-189.
Biologics and Biosimilars: Background and Key Issues
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FDA from 1990 through 1999, 6.7% originated from sources other than private industry.100 A
1993 study found that 7.6% of new drugs approved from 1981 through 1990 originated from
nonindustry sources.101 However, rather than focusing on all drug approvals—including many
“me too”102 drugs—another approach is to look at the origin of truly innovative new drugs, what
FDA calls new molecular entities (NMEs). NMEs are drugs that have not been approved by FDA
previously and frequently provide important new therapies for patients.103 A 2010 study found
that of the NMEs and new biologics that received FDA approval between 1998 and 2007, 24.1%
originated from work that was publicly funded.104
A study by Stevens et al. published in 2011 claims to be more comprehensive than these earlier
investigations.105 The Stevens study identified 153 FDA-approved pharmaceutical products—102
NMEs, 36 biologics, and 15 vaccines—that were discovered at least in part by public-sector
research institutions (PSRIs) from 1970 through 2009. About half of these drugs fell into two
therapeutic categories: oncology and infectious disease. The study also examined more broadly
new drug applications (NDAs), not including biologics, approved from 1990 through 2007. The
study identified 1,541 approved NDAs, which includes, but is not limited to, drugs that are
NMEs; new esters, salts, or derivatives; and new formulations, combinations, and indications of
previously approved drugs. Of the 1,541 NDAs approved by FDA from 1990 through 2007, 143,
or 9.3%, resulted from work conducted in publicly funded labs.
The 2011 Stevens study considered a PSRI “to have participated in the applied phase of research
that led to discovery of a drug if it, solely or jointly, created intellectual property specific to the
drug that was subsequently transferred to a company through a commercial license.” The
methodology used by the Stevens study “excluded the role of PSRIs in the development of
platform technologies that have contributed to the development of whole new classes of drugs.”
For example, the following platform technologies were all developed with public funds and were
excluded from the study:
recombinant DNA technology (Cohen-Boyer patents);
100 Joseph A. DiMasi, Ronald W. Hansen, and Henry G. Grabowski, “The Price of Innovation: New Estimates of Drug
Development Costs,” Journal of Health Economics, vol. 22 (2003), pp. 151-185.
101 Kenneth I. Kaitin, Natalie R. Bryant, Louis Lasagna, “The Role of the Research-Based Pharmaceutical Industry in
Medical Progress in the United States,” Journal of Clinical Pharmacology, vol. 33, no. 5 (May 1993), pp. 412-417.
102 “Me too” drugs are structurally similar to drugs already available on the market. Critics fault industry for developing
these duplicative products rather than investing in research on innovative drugs. Me too drugs are often heavily
promoted by the pharmaceutical industry in order to gain a foothold on the market. See the January 7, 2015, ProPublica
study by Charles Ornstein and Ryann Grochowski Jones https://www.propublica.org/article/vying-for-market-share-
companies-heavily-promote-me-too-drugs.
103 According to FDA, “[c]ertain drugs are classified as new molecular entities (“NMEs”) for purposes of FDA review.
Many of these products contain active moieties that have not been approved by FDA previously, either as a single
ingredient drug or as part of a combination product; these products frequently provide important new therapies for
patients. Some drugs are characterized as NMEs for administrative purposes, but nonetheless contain active moieties
that are closely related to active moieties in products that have previously been approved by FDA. For example, CDER
classifies biological products submitted in an application under section 351(a) of the Public Health Service Act as
NMEs for purposes of FDA review, regardless of whether the Agency previously has approved a related active moiety
in a different product.” FDA, New Drugs at FDA: CDER’s New Molecular Entities and New Therapeutic Biological
Products, https://www.fda.gov/drugs/development-approval-process-drugs/new-drugs-fda-cders-new-molecular-
entities-and-new-therapeutic-biological-products.
104 Robert Kneller, “The Importance of New Companies for Drug Discovery: Origins of a Decade of New Drugs,”
Nature Review Drug Discovery, vol. 9, 2010, pp. 867-882.
105 Ashley J. Stevens, Jonathan J. Jensen, Katrine Wyller, et al., “The Role of Public-Sector Research in the Discovery
of Drugs and Vaccines,” The New England Journal of Medicine, vol. 364, no. 6 (February 10, 2011), pp. 535-541.
Biologics and Biosimilars: Background and Key Issues
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bacterial production methods for recombinant DNA (Riggs-Itakura patents);
production and chimerization106 methods for antibodies (Cabilly patents);
methods to produce glycosylated recombinant proteins in mammalian cells (Axel
patents); and
methods of gene silencing with the use of small interfering RNAs (Mello-Fire
patents).
Although these platform technologies enabled the development of many of the products approved
by FDA during the period evaluated in the study, they were excluded “because the PSRI scientists
who developed the platforms generally did not use them to develop specific drug candidates.”107
However, without these platform technologies, many new drugs would not have been developed,
resulting perhaps in a vastly different economic outlook for the pharmaceutical industry.
106 A chimeric antibody may have portions of the antibody molecule that were developed in an animal combined with
human portions to avoid an immune reaction when administered to a patient.
107 Ashley J. Stevens, Jonathan J. Jensen, Katrine Wyller, et al., “The Role of Public-Sector Research in the Discovery
of Drugs and Vaccines,” The New England Journal of Medicine, vol. 364, no. 6 (February 10, 2011), p. 537.
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Appendix A. Major Laws on Biologics Regulation In general, biological products are regulated (licensed for marketing) under the Public Health
Service Act—originally by the National Institutes of Health (NIH) and its precursors and later,
starting in 1972, by the FDA—and chemical drugs are regulated (approved for marketing) under
the Federal Food, Drug, and Cosmetic Act—by the FDA. This section provides a brief history of
these two acts and other relevant laws as they relate to biologics, as well as some of the important
amendments that have occurred during the past 100 years.
Relevant Laws
Biologics Control Act of 1902
The regulation of biologics by the federal government began with the Biologics Control Act of
1902, “the first enduring scheme of national regulation for any pharmaceutical product.”108 The
act was groundbreaking, “the very first premarket approval statute in history.”109 It set new
precedents, “shifting from retrospective post-market to prospective pre-market government
review.”110 The Biologics Control Act was passed in response to deaths (many of children) from
tetanus contamination of smallpox vaccine and diphtheria antitoxin. The act focused on the
manufacturing process of such biological products; it required that facilities manufacturing such
biological products be inspected before a federal license was issued to market them.
Pure Food and Drugs Act and the Federal Food, Drug, and Cosmetic Act
The Biologics Control Act predates the regulation of drugs under the Pure Food and Drugs Act,
which was enacted in 1906. The 1906 act “did not include any form of premarket control over
new drugs to ensure their safety ... [and] did not include any controls over manufacturing
establishments, unlike the pre-existing Biologics Act and the later-enacted Federal Food, Drug,
and Cosmetic Act (FFDCA).”111 The Pure Food and Drugs Act was replaced by the FFDCA in
1938. The FFDCA required that drug manufacturers submit, prior to marketing, a new drug
application (NDA) demonstrating, among other things, that the product was safe.
The Public Health Service Act
The Biologics Control Act was revised and recodified (42 U.S.C. 262) when the Public Health
Service Act (PHSA) was passed in 1944. The 1944 act specified that a biological product that has
been licensed for marketing under the PHSA is also subject to regulation (though not approval)
under the FFDCA. A biological product is defined under Section 351(i) of the PHSA, as
a virus, therapeutic serum, toxin, antitoxin, vaccine, blood, blood component or derivative,
allergenic product, or analogous product ... applicable to the prevention, treatment or cure
of a disease or condition of human beings.
108 David M. Dudzinski, “Reflections on Historical, Scientific, and Legal Issues Relevant to Designing Approval
Pathways for Generic Versions of Recombinant Protein-Based Therapeutics and Monoclonal Antibodies,” Food and
Drug Law Journal, 2005, vol. 60, pp. 143-260.
109 Ibid, p. 147.
110 Ibid.
111 Gary E. Gamerman, “Regulation of Biologics Manufacturing: Questioning the Premise,” Food and Drug Law
Journal, vol. 49, 1994, pp. 213-235.
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Section 351(j) of the PHSA states that the FFDCA “applies to a biological product subject to
regulation under this section, except that a product for which a license has been approved under
subsection (a) shall not be required to have an approved application under section 505 of such
Act.” Most biological products regulated under the PHSA also meet the definition of a drug under
Section 201(g) of the FFDCA:
articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of
disease in man or animals; and articles (other than food) intended to affect the structure or
any function of the body of man or other animals.
The PHSA was amended by the FDA Modernization Act of 1997 (FDAMA, P.L. 105-115) to
require a single biological license application (BLA) for a biological product, rather than the two
licenses—Establishment License Application (ELA) and Product License Application (PLA)—
that had been required between 1944 and 1997. The PHSA provides authority to suspend a license
immediately if there is a danger to public health.
The PHSA was amended by the Biologics Price Competition and Innovation Act (BPCIA) of
2009, enacted as Title VII of the Affordable Care Act (ACA, P.L. 111-148). The BPCIA created a
licensure pathway for biological products demonstrated to be “highly similar” (biosimilar) to or
“interchangeable” with an FDA-approved biological product, and it authorized the agency to
collect associated fees. The BPCIA also created FDA-administered periods of regulatory
exclusivity for certain brand-name biologics and biosimilar products, as well as procedures for
brand-name and biosimilar manufacturers to resolve patent disputes.
History of Regulation of Biologics by Federal Agencies
Following enactment of the 1902 Biologics Act, regulatory responsibility for biologics was first
delegated to the Hygienic Laboratory, a precursor of NIH.112 In 1972, regulatory authority for
biologics was transferred from the NIH Division of Biological Standards to the Bureau of
Biologics at the FDA.113
In 1982, the FDA’s Bureau of Drugs and Bureau of Biologics merged to form the National Center
for Drugs and Biologics.114 In 1988, the Center for Drugs and Biologics was split into the Center
for Drug Evaluation and Research (CDER) and the Center for Biologics Evaluation and Research
(CBER).115 CBER continued to use NIH facilities and buildings until it moved in October 2014 to
the new FDA headquarters in White Oak, MD.116
Because biotechnology products frequently cross the conventional boundaries between biologics,
drugs, and devices, determining the jurisdictional status of these products has been difficult for
both the FDA and industry. Some products have had characteristics that met multiple statutory
112 The NIH Almanac—Historical Data: Chronology of Events, at http://www.nih.gov/about/almanac/historical/
chronology_of_events.htm. In 1937, the biologics control program, previously the responsibility of the Division of
Pathology and Bacteriology, NIH, was assigned to the newly established NIH Division of Biologics Control
(redesignated Biologics Control Laboratory, 1944). In 1955, the biologics control function was placed in the newly
formed NIH Division of Biologics Standards.
113 About FDA, “Significant Dates in U.S. Food and Drug Law History” http://www.fda.gov/AboutFDA/WhatWeDo/
History/Milestones/ucm128305.htm.
114 FDA, Science and the Regulation of Biological Products, “From the Laboratory of Hygiene to CBER” p. 7,
http://www.fda.gov/downloads/AboutFDA/WhatWeDo/History/ProductRegulation/100YearsofBiologicsRegulation/
UCM070313.pdf.
115 Ibid.
116 See http://www.fda.gov/AboutFDA/CentersOffices/OfficeofMedicalProductsandTobacco/CBER/ucm385240.htm.
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and scientific definitions.117 In 1991, FDA published an Intercenter Agreement between CBER
and CDER.118 In general, the agreement stated that traditional biologics (vaccines, blood, blood
products, antitoxins, allergenic products), as well as most biotechnology products, would be
regulated by CBER. The small set of biologics regulated as drugs under the FFDCA (mentioned
above) would continue to be regulated by CDER, regardless of the method of manufacture.
In 2002, however, the FDA announced its intention to reorganize review responsibilities,
consolidating review of new pharmaceutical products under CDER, thereby letting CBER to
concentrate on vaccines, blood safety, gene therapy, and tissue transplantation.119 On June 30,
2003, responsibility for most therapeutic biologics was transferred from CBER to CDER.120
Under this structure, biological products transferred to CDER are regulated as licensed biologics
under Section 351 of the PHSA. Examples of products transferred to CDER include monoclonal
antibodies, immunomodulators (other than vaccines and allergenic products), growth factors, and
cytokines.121 Remaining at CBER are traditional biologics such as vaccines, allergenic products,
antitoxins, antivenins, venoms, and blood and blood products, including recombinant versions of
plasma derivatives (clotting factors produced via biotechnology).
User Fee Legislation
FDA first gained the authority to collect user fees from the manufacturers of brand-name
prescription drugs and biological products in 1992, when Congress passed the Prescription Drug
User Fee Act (PDUFA).122 With PDUFA, FDA, industry, and Congress reached an agreement on
two concepts: (1) performance goals—FDA would negotiate with industry on target completion
times for various review processes, and (2) use of fees—the revenue from prescription drug user
fees would be used only for activities to support the review of new product applications and
would supplement—rather than supplant—congressional appropriations to FDA. The added
resources from user fees allowed FDA to increase staff available to review applications and to
reduce the median review time for standard applications. Over the years, Congress has added
similar authority regarding medical devices, animal drugs, and generic human drugs.123 User fees
made up almost 50% of the FY2019 FDA budget.
The BPCIA, enacted as Title VII of the ACA, directed FDA to develop and present to Congress
recommendations for a user fee program to support review of biosimilar product applications
submitted under Section 351(k) of the PHSA.124 The Biosimilar User Fee Act of 2012 (BsUFA or
BsUFA I), enacted as Title IV of Food and Drug Administration Safety and Innovation Act
(FDASIA, P.L. 112-144), authorized FDA to assess and collect fees for agency activities
117 See, for example, “Assignment of Agency Component for Review of Premarket Applications,” Final Rule, Federal
Register, vol. 56, no. 225, November 21, 1991, pp. 58754-58758.
118 The Intercenter Agreement, http://www.fda.gov/oc/ombudsman/drug-bio.htm.
119 FDA Press Release, “FDA to Consolidate Review Responsibilities for New Pharmaceutical Products,” September 6,
2002.
120 Federal Register, vol. 68, no. 123, June 26, 2003, pp. 38067-38068.
121 Transfer of Therapeutic Products to the Center for Drug Evaluation and Research, http://www.fda.gov/cber/transfer/
transfer.htm. Also of interest is Approved Products Transferring to CDER, http://www.fda.gov/cber/transfer/
transfprods.htm, and Therapeutic Biological Products, http://www.fda.gov/cder/biologics/default.htm.
122 See CRS Report R44864, Prescription Drug User Fee Act (PDUFA): 2017 Reauthorization as PDUFA VI.
123 See CRS Report R44517, The FDA Medical Device User Fee Program: MDUFA IV Reauthorization, and CRS
Report RL34459, Animal Drug User Fee Programs.
124 ACA §7002(f).
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service 25
associated with the review of biosimilars from October 2012 through September 2017.125 Under
BsUFA I, FDA collected six different types of fees from industry;126 fee amounts were based on
inflation-adjusted PDUFA human drug application fee amounts for each fiscal year. Because no
marketed biosimilar biological products existed when the BsUFA I program started, it included
fees for products in the development phase—what FDA calls the Biosimilar Product
Development (BPD) program—to generate fee revenue for the new program and to enable
companies to meet with FDA in the early development of biosimilar biological products.127 The
BPD program provides assistance to industry sponsors in the early stages of developing a new
biosimilar product. As of May 1, 2018, “67 programs were enrolled in the BPD Program to
discuss development of proposed biosimilar products or proposed interchangeable products.
CDER has received meeting requests to discuss the development of biosimilar or interchangeable
products for 31 different reference products.”128
The biosimilar user fee program was reauthorized through FY2022 via the Food and Drug
Administration Reauthorization Act of 2017 (FDARA, P.L. 115-52), which was signed into law
by President Donald J. Trump on August 18, 2017.129 Under BsUFA II, the supplement fee and
the establishment fee have been dropped and the initial, annual, and reactivation BPD fees have
been retained. The product fee is renamed the BsUFA Program fee, “with a new provision that
sponsors shall not be assessed more than five BsUFA Program fees for a fiscal year per
application.”130 The application fee will no longer be reduced by the cumulative amount of BPD
fees paid by the sponsor for that product.
125 Title IV of the Food and Drug Administration Safety and Innovation Act (FDASIA, P.L. 112-144).
126 The following fee types were required under BsUFA I: an initial Biosimilar Product Development (BPD) fee; an
annual BPD fee; reactivation BPD; an application fee (with a fee differential depending on whether the application
contains clinical data or is a supplemental application); an establishment fee; and a product fee.
127 U.S. Congress, House Committee on Energy and Commerce, Subcommittee on Health, Review of the Proposed
Generic Drug and Biosimilars User Fees and Further Examination of Drug Shortages, Statement of Janet Woodcock,
CDER Director, FDA, 112th Cong., 2nd sess., February 9, 2012.
128 Joe Franklin, “Biosimilar and Interchangeable Products: Brief Update from FDA,” FDLI Annual Conference, May
3, 2018, slide 3, at https://www.fdli.org/wp-content/uploads/2018/05/Biosimilars-New-Developments-and-Updates-
3.pdf.
129 For further information, see CRS Report R44961, FDA Reauthorization Act of 2017 (FDARA, P.L. 115-52).
130 FDA, Biosimilar User Fee Act (BsUFA II) Reauthorization Public Meeting, October 20, 2016, slide 31,
https://www.fda.gov/downloads/ForIndustry/UserFees/BiosimilarUserFeeActBsUFA/UCM526071.pdf.
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service 26
Appendix B. Top-Selling Drugs
Table B-1. Top 15 Best-Selling Drugs of 2018
Biologics in bold; dollars in billions
Brand Name Nonproprietary Name Sponsor Companies 2018
Sales
Humira adalimumab AbbVie $19.936
Eliquis apixaban Bristol-Myers Squibb and Pfizer $9.872
Revlimid lenalidomide Celgene $9.685
Opdivo nivolumab Bristol-Myers Squibb and Ono
Pharmaceutical
$7.570
Keytruda pembrolizumab Merck $7.171
Enbrel etanercept Amgen and Pfizer $7.126
Herceptin trastuzumab Roche (Genentech) $6.981
Avastin bevacizumab Roche (Genentech) $6.847
Rituxan rituximab Roche (Genentech) and Biogen $6.750
Xarelto rivaroxaban Bayer and Johnson & Johnson $6.589
Eylea aflibercept Bayer and Regeneron
Pharmaceuticals
$6.551
Remicade infliximab Johnson & Johnson and Merck & Co. $5.908
Prevnar13 pneumococcal vaccine Pfizer $5.802
Stelara ustekinumab Janssen Biotech (Johnson & Johnson) $5.156
Lyrica pregabalin Pfizer $4.970
Source: Genetic Engineering & Biotechnology News, March 11, 2019.
Notes: Genetic Engineering & Biotechnology News indicate in the Notes for this article that the above amounts
include U.S. sales and, where applicable, sales elsewhere in the world. According to the text of the article, the “drugs are ranked based on sales or revenue reported for 2018 by biopharma companies in press
announcements, annual reports, investor materials, and/or conference calls.”
Author Information
Agata Dabrowska
Analyst in Health Policy
Acknowledgments
Judith Johnson, retired CRS Specialist in Biomedical Policy, had authored previous versions of this report.
Biologics and Biosimilars: Background and Key Issues
Congressional Research Service R44620 · VERSION 12 · UPDATED 27
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